The cancellation of a planned 700-room luxury hotel at the Downtown Disney shopping district will have a ripple effect throughout the theme park resort and across Anaheim that will have an impact on visitors making vacation plans for Disneyland and Disney California Adventure.

Disney pulled the plug on the planned 2021 Downtown Disney hotel after Anaheim eliminated a tax rebate agreement worth $267 million to the company. Hotel construction originally had been set to begin in July.

The grand opening of Star Wars: Galaxy’s Edge at Disneyland in summer 2019 and the Marvel Universe-themed land at Disney California Adventure will drive huge crowds to the parks. The luxury hotel planned for the west end of Downtown Disney would have helped absorb some of that influx of additional visitors.

The opening of the first Wizarding World of Harry Potter at Universal’s Islands of Adventure in Florida generated 10-hour wait times just to enter the themed land. Fan anticipation for the first Star Wars themed lands in Anaheim and Florida has been equally intense.

The planned Disneyland hotel, set to open two years after Galaxy’s Edge, seemed like an afterthought to the initial Star Wars land announcement. Nonetheless, the additional hotel rooms would have provided some relief to the expected flood of Star Wars fans hoping to stay in a Disney hotel. And the hotel would have opened just a few years before the new Marvel Universe is expected to debut.

Now Star Wars and Marvel fans looking to stay at a Disney hotel will have to try the Disneyland Hotel, Disney’s Grand Californian or Disney’s Paradise Pier, which already boast high occupancy rates.

The cancellation of the resort’s fourth hotel won’t affect Star Wars: Galaxy’s Edge or the Marvel-themed land, Disneyland officials said during a phone interview.

“Now that Disney has canceled the hotel complex, the question becomes: What will the company do with the vacant buildings on the west side of Downtown Disney?” Adrienne Vincent-Phoenix wrote on MousePlanet, a Disney fan website.

Reopening the Starbucks location would be “relatively easy,” but finding operating partners for the shuttered ESPN Zone and Rainforest Cafe “won’t be so simple,” Vincent-Phoenix wrote on MousePlanet.

Several new west end tenants — including an ice cream shop, brewery and burger restaurant — are set to open soon, which will help alleviate some of the vacant storefronts. A trio of food trucks have been parked in front of vacant locations in hopes of alleviating the empty feeling of the west end.

It is too early to say if the Rainforest Cafe, ESPN Zone and AMC theater locations will be renovated or demolished, Disney officials said. Walt Disney Imagineering is working on redevelopment concepts for Downtown Disney’s west end, the officials said. The plan is to bring in “big guest pleasers,” according to officials.

Disney officials said there are no conversations taking place at the moment with the Rainforest Cafe or ESPN Zone about returning to Downtown Disney. AMC announced plans to move to the nearby Anaheim Garden Walk.

Anaheim-Disney relationship

The often symbiotic relationship between the city of Anaheim and the Disney company has occasionally grown rocky over the years. At the moment, the two sides are at one of the lower points in their on again-off again courtship.

In the 1990s, Anaheim and Disney found themselves at odds when the entertainment giant floated a plan to build the DisneySea theme park in Long Beach. Now the city and the company find their relationship on the rocks again over tax incentives and a living wage initiative.

Anaheim voters will choose a new mayor and three council members in November. Disney officials say they are looking forward to working with the new city leadership.

“Depending on what happens in that election and in terms of Disney’s relationship with the city of Anaheim in coming months and years, the company may just take a second look at building in neighboring Garden Grove when it decides the time has come to expand again,” Vincent-Phoenix wrote on MousePlanet.

Another Disney hotel

While Disney is keeping all options on the table, officials say the company has no plans to build a fourth hotel at the Disneyland resort at this time.

Mouse Tales author David Koenig insists Disney will head back to the drawing board with plans for a new hotel once the drama settles with Anaheim.

“Trust me, a fourth hotel will come, although the announcement will be made after they can fully form a better plan at a better time,” Koenig said via email.

Theme park crowding

The cancellation of the Downtown Disney hotel project has a few potential upsides: Fewer theme park visitors and less congestion in Downtown Disney.

Another Disney hotel would have meant more visitors in the park — crowding already-clogged pathways, adding to ride wait times and reducing the number of FastPasses available to non-hotel guests.

Construction of the luxury hotel would have also created a navigation nightmare for Disneyland Hotel and Paradise Pier Hotel guests trying to reach the theme parks via Downtown Disney amid an endless maze of construction walls.

“The Downtown Disney hotel always struck me as too major a change to be rushed,” Koenig said via email. “If it had proceeded, it would have brought extra congestion and distractions at the worst possible time: Next summer’s opening of Star Wars Land.”

Disney officials say the canceled hotel project won’t have any impact on the number of guests coming to the Anaheim theme parks.

Fewer rooms, higher prices

The law of supply and demand means that with fewer rooms available at Disney hotels the three existing Disney hotels in Anaheim will be able to command higher prices.

Disney officials acknowledge there is demand for a fourth hotel at the Disneyland resort and that occupancy rates remain high for the 2,500 rooms at the three existing Disney hotels in Anaheim.

But that doesn’t mean visitors clamoring to see the Star Wars and Marvel lands in the coming years will have any shortage of places to stay in Anaheim. Hotel construction is booming in the city.

Nearly 1,800 hotel rooms are being built in Anaheim, according to a report by Atlas Hospitality Group. The projects include high-end Marriott and Westin properties as well as three moderately priced hotels. Meanwhile, Radisson and Hilton projects are planned for 2021.

Brady MacDonald is a freelance writer based in California. He’s covered the theme park industry for more than 25 years. He writes about travel, entertainment, business, food and beer. His work has appeared in the Chicago Tribune, New York Newsday, Philadelphia Inquirer, Seattle Times, Orlando Sentinel and Orange County Register.